Jobbing Umbrella Company Employees may be concerned to hear that the Communications Workers Union has attacked the Pay Between Assignments (PBA) provisions of the AWR as “immoral”.

The Union slammed PBA (also known as the Swedish Derogation Model) as a “legal loophole” which it felt to have been exploited by Manpower. Though not illegal, the union argued, it was “against the spirit of AWR,” leaving 1,000 temporary agency workers placed by Manpower in BT call centres up to £584 a month worse off than other Manpower temps in the same call centres. The latter qualify for equal pay under the AWR’s twelve-week rule.

PBA contracts enable workers to receive up to four weeks of half-pay between assignments if they waive the AWR right to equal pay with permies after 12 weeks. A number of skilled professionals working through Umbrella Companies have opted for this model.

The REC’s director of policy and professional services, Tom Hadley, said: “The reality is that the Pay Between Assignment model is not a ‘loophole’ – it is a legitimate part of the legislation that was agreed after significant consultation by the government with recruiters, employers and unions.”

His comments were echoed by Andy Hogarth, CEO of the recruiter Staffline, who said: “The Swedish Derogation is not exploitation, it is not a loophole, it is the law, and it is something that the Labour government always expected to be used.”

Kevin Barrow, a legal expert from Osborn Clark, said that the unions have recently decided to interpret the PBA in this way; however, he added: “The quid pro quo for workers who qualify for equal pay is that they don’t get paid between assignments.”

So the Swedish Derogation Model has been found to be a legal and compliant way of working.

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